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by Chuck Cranes, the company's owner.

$($Click the icon to view the data for the three projects.$)$

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Read the requirements.

Requirement $1.$ Because the company's cash is limited$,$ Cranes thinks the payback method should be used to choose between the capital budgeting projects.

Calculate the payback period for each of the three projects. Ignore income taxes. $($Round your answers to two decimal places.$)$

Using the payback method, which project$($s$)$ should Cranes choose?

Requirements

Because the company's cash is limited$,$ Cranes thinks the payback method should be used to choose between the

capital budgeting projects.

a$.$ What are the benefits and limitations of using the payback method to choose between projects?

b$.$ Calculate the payback period for each of the three projects. Ignore income taxes. Using the payback method,

which projects should Cranes choose?

Babson thinks that projects should be selected based on their NPVs$.$ Assume all cash flows occur at the end of the

year except for initial investment amounts. Calculate the NPV for each project. Ignore income taxes.

Which projects, if any, would you recommend funding? Briefly explain why.

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